Why the selloff in Bristol-Myers is just beginning

Shares of Bristol-Myers Squibb dropped more than 6 percent Thursday after BMO Capital downgraded the drug maker to "market perform" from "outperform."

The firm said new data about Bristol's Nivo+Yervoy cancer treatment created uncertainty about its future, and negated their prior optimism.

(Read: Bristol-Myers slumps on cancer drug study data)

However, BMO noted things could brighten up for Bristol-Myers in the coming months. "We could get more constructive on the name in October/November ahead of Nivo mono Rx data in NSCLC [non-small cell lung cancer]," the firm wrote in an analyst note.

So is this a short-term selloff, or signs of long-term problems?

Rich Ross of Auerbach Grayson said the charts are painting a clear picture. Sell.

"This stock is a tale of two tops and clearly this is the worst of times for Bristol-Myers," Ross said. "When we look at the stock longer term, we see it goes from bad to worse."

And Ross is predicting a sharp move down to $35 dollars per share. "We've accelerated in such a fashion and now that I see that bearish double top at the tail end of this five-year bull run. It set the stock up for a fast move down."